One way to shut down the outrageous opposition incumbents throw in front of community broadband projects is for communities to become, literally, stockholders in the network. The way the Green Bay Packers do it. They raised $70 million in five weeks selling $250 stock shares Dec – Jan. The worst time of year during one of the worse recessions in history.
Say what you will about the team’s playoff performance, the city of Green Bay totally kicks butt when it comes to displaying their prowess as community owners of a vital economic asset. Communities across the U.S. that want better broadband can learn from them – and replicate their success, though maybe on a smaller dollar scale and a longer timeline. But in the end, they should have the kind of highspeed broadband that improves economic development, healthcare delivery, education and several other vital functions that benefit individuals and local businesses.
Part of how you get from here to there I describe in my latest GigaOm article. But it’s important everyone realize that the easy part is setting up a nonprofit to enable a community to build and maintain control of the network. To get to the point of the Packers where there is the rampant enthusiasm – on a relative scale, don’t forget – that makes a stock offering possible, there’s a hell of a lot of work required.
To make the heavy lifting possible, you need great partners. You should include on the list of valuable partners a couple of local service providers. While the community should own the network infrastructure, a fair amount of the service delivery should come from ISPs. However, in the end, local needs should determine these issues. The following excerpt from my book, “Fighting the Next Good Fight,” offers good advice for developing the types of partnerships that will make recruiting community investors much easier.
First steps to community investing success
It is important early on to determine who the stakeholders are. They have an important role to play providing feedback, gathering research information, overcoming political and financial barriers, rallying constituent support and ultimately recruiting network users (a.k.a. increasing broadband adoption).
It’s through your needs assessment that you identify and recruit stakeholder organizations that bring revenue and subscribers to the network. Two main selection criteria should be: 1) who can make your network more appealing to federal agencies, financial services companies and other institutions that can bring financing to build the network, and 2) which stakeholders can help you financially sustain the network once it’s built.
An emphasis on financial sustainability absolutely should not eclipse low-income constituents as key stakeholders who have an equal place at the table. As I mention frequently, by ensuring your network’s financial wellbeing you ensure its ability to benefit un-served and underserved constituents.
The Department of Homeland Security is a good candidate for grants if your stakeholders include public safety agencies. The business community may top your list of partners that can draw support from associations such as the Chamber of Commerce, which in turn can attract smaller business that need a lot of broadband and will pay for premium (but fairly priced) services.
Two powerful county government partners are public safety and public works. Meeting their needs opens your grant options to additional federal agencies such as the Departments of Justice and Energy. Public works projects allow you to reduce the cost of broadband infrastructure build-outs. Every Department of Transportation road, bridge and public building project, for example, is an opportunity to install broadband infrastructure at a reduced cost.
K-12 schools, colleges and universities are valuable stakeholders. They have a huge need for broadband, which opens them to various foundation and government grant opportunities. Higher learning institutions that are able to access many megs or gigs of Internet speed are eligible for large research grants that bring huge economic benefits to your community.
Finally, your pursuit of key partnerships should include the vendors and service providers that make network infrastructure and services possible. However, public/private partnerships need to be better structured than those arrangements highly touted years ago during the days of muni wireless hype. For one thing, no one this time expects private sector companies to carry the whole financial load while the municipality gets free services.
“You have to be sure providers can make money,” observed Franklin County, VA, IT Director Sandie Terry. “Our wireless Internet service provider has just a two-year return on investment because they’re receiving space on vertical assets such as government buildings in exchange for charging local government lower rates.” Everyone coming to the table – and I encourage lots of partnering with local or regional telcos and WISPs – needs to be out-of-the-box thinkers when it comes to structuring mutually beneficial partnerships.
You probably noticed that all of this advice is geared toward making the network financially sustainable, but doesn’t talk about potential investor. That’s because you can’t get people to invest just based on community pride alone. You have to prove to locals that the network as a viable long-term investment. Constituents’ investment is what makes building the network possible, but the network has to show it can earn revenue to offset at least some of the operating costs, plus deliver other benefits in the name of the public good.
In just these first couple of weeks of talking about Green Bay, the amount of feedback from people has been pretty amazing. Keep an eye out for more content coming to this blog that addresses opportunities and challenges facing efforts by communities to take better control of their broadband future.
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